Title
Implementing Rules of RA 7925 on Telecom Services
Law
Ntc Memorandum Circular No. 8-9-95
Decision Date
Sep 25, 1995
The Implementing Rules and Regulations (IRR) of Republic Act No. 7925 establish regulations for telecommunications services in the Philippines, covering various aspects such as local exchange services, interexchange and international carrier services, mobile radio services, radio paging and value-added services, interconnection and access charges, and other related regulations.

Law Summary

Local Exchange (LE) Services

  • Mandatory universal basic telephone service with non-discriminatory access within authorized areas.
  • Compliance with prescribed service performance and technical standards required.
  • Expansion of long distance services in LE areas restricted, with exceptions for failure to meet service/time standards or compensation agreed.
  • Multiple LE operators in an area require compensation sharing based on working line counts.
  • Commission may authorize new LE operators to address unmet demand (90% of applications served within 10 days).
  • Bypass rules apply to PSTN only; LE operators have first right for pay telephone services.
  • Use of cost-effective, preferably state-of-the-art, technology mandated.

Interexchange Carrier (IXC) and International Carrier (IC) Services

  • IXCs must interconnect non-discriminatorily with other carriers under prescribed rules.
  • IXCs follow prescribed technical/service standards.
  • ICs must comply with guidelines; failure to install required local exchange lines within 3 years may lead to authority cancellation.

Mobile Radio Services (MRS)

  • Cellular Mobile Telephone System (CMTS) operations follow existing NTC rules.
  • Roll-out plans for LE service by CMTS operators reduced to 3 years.
  • CMTS subscribers not counted as LE subscribers.
  • Failure to install required 400,000 LE lines within 3 years may result in cancellation of authority.
  • Public Repeater Network (PRN) services deregulated; providers must publish rate changes and notify subscribers/Commission beforehand.

Radio Paging and Value Added Services

  • Radio paging providers must register, apply for frequencies, and comply with standards.
  • Paging service rates deregulated with public notice and Commission notification required before rate changes.
  • Expansion of paging services requires prior notice to Commission; no formal approval needed.
  • Non-PTE Value Added Service (VAS) providers do not need congressional franchise; must register with Commission.
  • VAS providers must use authorized PTE transmission networks and comply with performance standards.

Interconnection and Access Charges

  • Interconnection rules adopted; parties to negotiate charges, with Commission resolving disputes.
  • Parties encouraged to share facilities and route calls via nearest interconnection points using lowest cost routing.
  • Local exchange services cross-subsidized by other telecom services until properly cost-priced.
  • Cost manual based on modified FCC accounting rules submitted annually for approval.
  • Interconnection charges include access charge plus subsidy, classified by geographic area.
  • Detailed cost separation and allocation rules specified, emphasizing transparency and non-discrimination.
  • No access charges between LE operators with fixed monthly rates; otherwise, negotiation required.

Radio Spectrum

  • Spectrum allocation subject to periodic review to enable universal access and adoption of cost-effective technology.
  • Radio Frequency Consultative Committee (RFCC) to recommend procedures on spectrum review, frequency transfer, user fees, and bidding for scarce frequencies.

Rates and Tariff

  • Commission to establish fair and reasonable rates supporting economic viability and investment returns.
  • Deregulation of rates allowed where competition sufficient, but cross-subsidies for LE service maintained until cost-based pricing.
  • Promotional rates under 15 days require notice; longer promotional rates treated as rate reductions with administrative approval.
  • Rate increases require quasi-judicial proceedings; provisional authority may grant immediate effect with conditions.
  • Rental/lease of terminal equipment rates deregulated.
  • Deregulated entities must monthly submit rate changes.

Consumers and End Users; Expansion/Modernization Of Facilities

  • Telecommunications services to meet prescribed performance standards.
  • Service applications served first-come, first-served; priority to emergency/security establishments.
  • Customers responsible for calls made from their equipment with documented billing.
  • Billing timelines specified; failure to bill timely subject to sanction.
  • Complaint mechanisms established with timelines for PTE response and Commission adjudication.
  • Customer Premises Equipment deregulated.
  • Expansion or upgrading of existing plant within authorized areas does not require Commission approval but must be reported.

Other Regulations

  • Standards to follow international recommendations and treaties.
  • Cable TV operations governed by separate EO but treated as PTEs if offering telecom services.
  • Mergers/acquisitions levy local service obligations on surviving/acquiring company.
  • Prohibition of unauthorized callback/dialback schemes and resale of leased lines.

Transitory Provisions and Nullity Clause

  • Existing franchises with valid CPCN or PA continue until expiration or revocation.
  • Unused or unregistered franchises as of effectivity date are revoked.
  • Invalidity of any provision does not affect remaining provisions.

Effectivity and Amendment

  • Circular may be revised, amended or repealed by Commission as necessary.
  • Takes effect 15 days after publication and filing with UP Law Center.

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